Mark Cliffe of ING Bank believes that central banks’ digital currencies will arrive within two to three years.
Cliffe is the leading economist of the Dutch bank ING and in a video published on think.ing.com and explicitly dedicated to the digital currencies of central banks he stated:
“The central banks are probably going to have to make some move on a digital currency within the next two to three years.”
According to Cliffe, the Facebook stablecoin initiative is putting a lot of pressure on the central banks themselves, so much so that a certain sense of urgency is emerging.
“one of the motivations behind having a digital currency is you might be able to get rid of the real currency the hard cash and notes to make it into a fully digital exercise.”
This would allow to widen the potential of monetary policies, so as to allow perhaps even more negative interest rates than the current ones.
However, Cliffe does not explain how this could happen and why an exclusively digital currency could make negative rates even more negative.
Rapid advances in Distributed Ledger Technology are stimulating debate about the possibilities, advantages and disadvantages of possible central bank digital currencies (CBDCs) so that China would be ready to issue one.
In particular, political preferences regarding privacy, data administration, market power, information security and the division of labour between the public and private sectors would, according to ING, be among the most important drivers.